Combined heat and power cuts costs, emissions (also, baby pandas)

Written By March 8, 2012

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A combined heat and power system at the Albert Lea Wastewater Treatment Plant has cut its energy expenses by up to $60,000 a year. Photo courtesy Rick Ashling.

At some point every summer, the wastewater treatment plant in Albert Lea, Minnesota, usually gets a phone call from its gas utility asking whether something is wrong with its meter.

In reality, the meter stops moving because the plant’s waste digesters periodically draw all the power they need by using heat and methane recovered from their own operation.

The city of Albert Lea and Alliant Energy installed a mini, on-site power plant at the wastewater facility in 2003. Methane gas given off from the digesters is collected, cleaned, and burned to spin four small turbines, which generate up to 120 kilowatts of backup electricity.

The spinning turbines also create heat. Instead of venting it into the atmosphere or discharging it into a lake or river, the Albert Lea facility captures this exhaust and uses it to maintain the 90-degree temperature required by bacteria in its digesters. The 28 million BTUs of heat recovered daily is enough to also heat part of its building during cooler months, too.

The system is what’s known as combined heat and power (CHP) — using an energy source to simultaneously generate electricity, mechanical power or thermal energy.

The concept, which is also known as cogeneration, has been around for more than a century but is recently receiving new attention because of its potential to increase energy efficiency, and possibly the competitiveness of U.S. industries.

Congressman Charles Bass, a New Hampshire Republican who co-chaired Mitt Romney’s campaign steering committee in that state, introduced legislation last month asking federal agencies to draft a strategic plan to double the nation’s use of combined heat and power by 2020. The bill has Republican and Democratic co-sponsors, including Utah Democrat Jim Matheson.

The United States currently has about 85 gigawatts of generating capacity — or 9 percent of its total — from combined heat and power facilities. As a share of national power production, the country trails many Asian and European nations. Germany gets 13 percent of its power from CHP facilities. Russia gets 31 percent and Denmark draws 53 percent of its power from CHP.

A 2008 report [PDF] by the U.S. Department of Energy’s Oak Ridge National Laboratory said that if the U.S. increased its CHP share to 20 percent by 2030, it would offset 848 million metric tons of carbon dioxide emissions — the equivalent of 154 million cars being taken off the road — as well as create 936,000 new jobs.

Michigan ranked ninth in the nation for installed CHP capacity in 2006, with 3,104 megawatts. Ohio is spotlighted in the Oak Ridge report as one of five states with the most CHP technical potential, and utility regulators there are exploring waste heat as an option to offset capacity losses as coal plant shut down.

The amount of energy lost in the form of waste heat in U.S. electricity generation is greater than the total energy use of Japan, according to the Oak Ridge report. Most cogeneration systems have been installed by large manufacturing, commercial and institutional energy customers. They’re used in mining, agriculture, paper and pulp, and wastewater operations.

In Albert Lea, the cogeneration system installed at the wastewater treatment plant has cut the city’s energy costs between $40,000 and $60,000 a year. The implementation cost $250,000, with the state and Alliant Energy paying for more than two-thirds of that through the state’s Conservation Improvement Program. Maintenance has been minimal besides routine cleaning of filters. (Here’s a PDF of a case study from the Midwest CHP Application Center.)

“This system is working,” says plant supervisor Rick Ashling. “Even if I have a year where there’s larger maintenance expenses, we’re still saving money.”

Ashling wants to upgrade the system to it can conserve even more energy. He’d like to replace the four existing 30-kilowatt turbines with three newer, more efficient 60-kilowatt models, reducing the amount of space the system takes up while also increasing its output to 180 kilowatts. Financing has proven to be a stumbling block, though.

“Right now we can’t find money to do it,” Ashling said. “I keep looking for grants, and we can’t come up with anything yet.”

Financing is just one of the barriers to cogeneration projects. Many utility rate structures don’t reward conservation, which hurts the economic case for CHP. The systems usually require integration with the existing utility grid, a process that varies significantly from region to region. And the design of many environmental regulations can sometimes penalize the projects.

The Pew Environment Group says doubling cogeneration by 2020 would reduce energy consumption by 3 percent, which would offset the need for more than 200 midsize power plants. It’s advocating for a 30 percent federal investment tax credit for cogeneration projects with hopes the incentive would be enough to slow — or stop — hundreds more utility meters across the country.